M/s. Santosh Kumar Kejriwal Securities Pvt. Ltd., Kolkata V. ACIT, Circle - 5, Kolkata, Kolkata

ITA 1168/KOL/2009

• Counselvise Citation: [2011] 134 COUNSELVISE.COM (IT) 9329 (ITAT-KOLKATA)
• Duration Of Justice: 1 year(s) 7 month(s) 4 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 11-02-2011
• Appeal Filed By: Assessee
• Bench Allotted: C
• Assessment Year: 2005-2006
• Appeal Filed On: 07-07-2009
• Court: TRIBUNAL
• Department Lawyers: S S KUMAR LD
• Assessee Lawyers: RAVI TULSIYAN LD
• Keywords: Rule 8D; Set aside
• Section: 143(3)

Judgement Text

, , , IN THE INCOME TAX APPELLATE TRIBUNAL C BENCH : KOLKATA () . . , , !' ..! , # , ,, , ) [BEFORE HONBLE SRI D.K.TYAGI, JM & HONBLE SRI C.D.RAO, AM] '$ / I.T.A NO. 1168/KOL/2009 %&' !() / ASSESSMENT YEAR : 2005-06 M/S. SANTOSH KUMAR KEJRIWAL SECURITIES VS- ASSTT. COMMISSIONER OF INCOME-TAX,- PVT. LTD. PAN: AAHCS 0077P CIRCLE-5, KOLKATA (+, /APPELLANT ) (-+,/ RESPONDENT ) +, / FOR THE APPELLANT : . / SHRI RAVI TULSIYAN, LD.AR -+, / FOR THE RESPONDENT : . / SHRI S.S. KUMAR, LD.DR / / ORDER ..! , , , , # , ,, , SHRI C.D.RAO, ACCOUNTANT MEMBER . : THE ASSESSEE IS IN APPEAL AGAINST THE ORDER DT. 18-03-2009 OF THE COMMISSIONER OF INCOME-TAX (APPEALS), KOLKATA FOR THE AY 2005-06 . 2. THE ONLY ISSUE RAISED IN THIS APPEAL IS RELATING TO THE DISALLOWANCE U/S.14A OF THE IT.ACT61. 3. BRIEF FACTS OF THIS ISSUE ARE THAT WHILE DOING T HE SCRUTINY ASSESSMENT U/S. 143(3) OF THE I.T.ACT61 THE ASSESSING OFFICER HAS DISALLOWED AN AMOUNT OF RS.3,23,328/- U/S.14A BY OBSERVING THAT THE JURISDI CTIONAL TRIBUNAL HAS CONSIDERED THE DISALLOWANCE OF 1% OF THE TOTAL DIVIDEND EARNE D U/S.14A. 4. HOWEVER, ON APPEAL THE LD.CIT(A) HAS DIRECTED TH E ASSESSING OFFICER TO APPLY RULE 8D FOLLOWING THE RATIO OF DECISION IN THE CAS E OF ITO VS. DAGA CAPITAL MANAGEMENT [ITAT, SPECIAL BENCH, MUMBAI IN ITA NO.8 057/MUM/2003] TO RECOMPUTED THE DISALLOWANCE AS PER RULE 8D. 5. AGGRIEVED BY THIS, NOW THE ASSESSEE IS IN APPEA L BEFORE US. 6. AT THE TIME OF HEARING BEFORE US THE LD. COUNSEL FOR THE ASSESSEE HAS CONTENDED THAT RULE 8D IS NOT APPLICABLE FOR THE AY 2005-06 IN VIEW OF JUDGMENT OF THE HONBLE BOMBAY HIGH COURT IN THE CASE OF GOD REJ & BOYCE MFG. CO. LTD VS. DCIT(2010) 328 ITR 81(BOM.). THEREFORE, HE REQU ESTED TO SET ASIDE THE ORDER OF THE LD.CIT(A). ITA NO.1168/KOL/09-CDR 2 7. ON THE OTHER HAND, THE LD. DR HAS RELIED ON THE ORDERS OF THE REVENUE AUTHORITIES. 8. AFTER HEARING THE RIVAL SUBMISSIONS, ON CAREFUL PERUSAL OF THE MATERIAL AVAILABLE ON RECORD KEEPING IN VIEW OF JUDGMENT OF THE HONBLE BOMBAY HIGH COURT IN THE CASE OF GODREJ & BOYCE MFG. CO. LTD (S UPRA), WE ARE OF THE VIEW THAT RULE 8D IS NOT APPLICABLE FOR THE AY 2005-06. HOWEV ER, THE ASSESSING OFFICER HAS DISALLOWED 1% OF DIVIDEND INCOME FOLLOWING THE RATI O OF DECISION OF THE JURISDICTIONAL TRIBUNAL. THUS, THE LD.CIT(A) WAS NO T JUSTIFIED IN DIRECTING THE AO TO APPLY RULE 8D. 9. IN THE RESULT, THE ABOVE APPEAL OF THE ASSESSEE IS ALLOWED. 0 / #1 2 1& 03 THIS ORDER IS PRONOUNCED IN THE OPEN COURT ON 11-0 2-2011 SD/- SD/- (. . ), ( ..! ), # , (D.K.TYAGI), JUDICIAL MEMBER. ) ( C.D. RAO, ACCOUNTANT MEMBER) (#) DATE :11-02-2011 *PP / SR. PRIVATE SECRETARY : / 4 -%%5 65(7- COPY OF THE ORDER FORWARDED TO: 1. (+, / APPELLANT ) : M/S. SANTOSH KUMAR KEJRIWAL SECURITIES PVT. LTD 2 BRABOURNE ROAD, GOVIND BHAWAN, 6 TH FL., KOL-1. 2. ( -+,/ RESPONDENT) : ACIT, CIR-5 KOLKATA. 3. %/& ()/ THE CIT(A) 4. %/& ()/ THE CIT 5. !9% -%& / DR, KOLKATA BENCH 6. GUARD FILE 5 -%/ TRUE COPY, /&1/ BY ORDER, . ': /ASSTT REGISTRAR